Correlation Between Putnam Equity and Guidepath(r) Managed
Can any of the company-specific risk be diversified away by investing in both Putnam Equity and Guidepath(r) Managed at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Putnam Equity and Guidepath(r) Managed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Putnam Equity Income and Guidepath Managed Futures, you can compare the effects of market volatilities on Putnam Equity and Guidepath(r) Managed and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Putnam Equity with a short position of Guidepath(r) Managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Putnam Equity and Guidepath(r) Managed.
Diversification Opportunities for Putnam Equity and Guidepath(r) Managed
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Putnam and Guidepath(r) is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Putnam Equity Income and Guidepath Managed Futures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guidepath Managed Futures and Putnam Equity is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Putnam Equity Income are associated (or correlated) with Guidepath(r) Managed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guidepath Managed Futures has no effect on the direction of Putnam Equity i.e., Putnam Equity and Guidepath(r) Managed go up and down completely randomly.
Pair Corralation between Putnam Equity and Guidepath(r) Managed
Assuming the 90 days horizon Putnam Equity Income is expected to generate 0.84 times more return on investment than Guidepath(r) Managed. However, Putnam Equity Income is 1.2 times less risky than Guidepath(r) Managed. It trades about 0.13 of its potential returns per unit of risk. Guidepath Managed Futures is currently generating about -0.13 per unit of risk. If you would invest 3,448 in Putnam Equity Income on August 29, 2024 and sell it today you would earn a total of 390.00 from holding Putnam Equity Income or generate 11.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Putnam Equity Income vs. Guidepath Managed Futures
Performance |
| Timeline |
| Putnam Equity Income |
| Guidepath Managed Futures |
Putnam Equity and Guidepath(r) Managed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Putnam Equity and Guidepath(r) Managed
The main advantage of trading using opposite Putnam Equity and Guidepath(r) Managed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Putnam Equity position performs unexpectedly, Guidepath(r) Managed can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Guidepath(r) Managed will offset losses from the drop in Guidepath(r) Managed's long position.| Putnam Equity vs. Franklin Lifesmart Retirement | Putnam Equity vs. Lifestyle Ii Moderate | Putnam Equity vs. Calvert Moderate Allocation | Putnam Equity vs. Dimensional Retirement Income |
| Guidepath(r) Managed vs. Aqr Managed Futures | Guidepath(r) Managed vs. Pimco Trends Managed | Guidepath(r) Managed vs. Pimco Trends Managed | Guidepath(r) Managed vs. Asg Managed Futures |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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